On Friday November 13, 2009 Vietnam lifted its ban on gold imports. The State Bank of Vietnam had stopped granting quotas in June 2008 for gold bar imports, stating that the country needed to "economise" on foreign currencies for the importing of essential goods for domestic consumption.

During the year prior to the ban, it is estimated that Vietnam had imported over 100 tonnes of gold in response to falling equity and property markets, plus high price increases for consumer goods.

The ban lead to a large gap between global and domestic prices for gold which prompted the growth of black market smuggling operations from neighbouring countries. Many in Vietnam remember the hyperinflation in the 1980s and remain skeptical of using the Vietnamese Dong as a store of value for their wealth.

The unofficial exchange rate of one US Dollar for 19,000 Vietnamese Dong is some five percent above the official interbank rate as traders, including gold smugglers, collect dollars on the market to make payments for import deals.

Governor Nguyen Van Giau of the State Bank of Vietnam announced that domestic gold trading companies will be granted permission to import gold at appropriate volumes to "intervene in the market in order to stabilise the market, combat speculation and prevent an impact on the interests of the people."

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© 2009 DollarDaze

ABOUT THE AUTHOR

Mike Hewitt is the editor of DollarDaze.org, a website pertaining to commentary on the instability of the global fiat monetary system and investment strategies on mining companies. His website also provides a no-cost market data feed service with up-to-date quotes on currency exchange rates, commodity prices and major indices. Mike can be emailed at mikehewitt@hotmail.com.

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Posted in Current Events, Gold, Mike Hewitt